The Somerset herald. [volume] (Somerset, Pa.) 1870-1936, 1887-08-24

A Gentleman who Believes In the
South Penn.


| the South Penn 10 a reporter the other day.
II shows cosfcsnsissly that their efforts to
stop the completion of the competing line
have reached the Stage ~hssi no action. how
ever unprecedented, viii le 0snitt,-i fbai af-
lords straw a, catch AZ The 6est lawsers
tell me that nothing Like il was ever heard of
in legal practice Here IS legal dispute in
which the interests OF two Pennsylvania cor
porations are involved, that has been fully
argued in the State courts The preiimina-
~ injunction has praetieally shown the
claim Of the Pennsylvania railroad to be
against pablie policy and contrary to the
constitution But while the final hearing in
the State courts Is still pending the Pennsyl-
yania road seeks TO take the question 10 the
United States Courts in another State and to
hayeo question decided there which Is
wholly subject to the constitution of this
State This shows that the Pennsylvania
railroad recognizes that the day has gone by
when il can have its own way In the Penn
syivania courts, and is resorting to desperate
measures to drag in the authority of outside
courts.
= The remarkable nature of the suit ap-
pears IN another respect. The bill tries 70
make il appear that the bargain for the de
livery of the South Penn was completed
The fact is that the stock which was 10 trans
fer the control of the South Penn was never
delivered, nor did the 6D per oentum sPeci-
fed in the Vanderbilt Roberts bargain even
sign. The entire bargain Sell through when
the 90 per cent. stipulated in the original
deal did not assent TO the transfer The only
claim the Pennsylvania has is upon certain
individuals who agreed to deliver il certain
securities or shares which it desired to con-
troll, providing % per centnm of the whole
signed.
That agreement has been enjoined by the
State Courts as contrary 10 the State Consti-
tuition, and 4 re-argument before the same
tribunal Is rethreshing old straw But even
if the final decision OF the courts should hold
legal the only right that the Pennsylvania
railroad would have would be- to sue those
who had not carried out their agreement,
for breach Of contract Their present pro-
eeeding i exactly the same rs if anyone
should claim that a failure TO deliver stocks
IN any corporation should prevent that cor
poration from TRANSMITTING the business for
which il was chartered. Yes, in addition
10 the commentary which this proceeding
makes ON the claim that il was not the Penn
sylvania railroad. bat some ether CORPORA
tion that purchased the South Penn, it re-
veals the desperation with which that
corporation is catching at any method, how
ever unprecedented. 10 choke off the new
project
The gentleman referred to the immense
cost and capitalization of the Pennsylvania.
and then said a. The Pennsylvania railroad
will always be able 10 earn a large profit on
its legitimate and honest investment The
effect of the fourth section Of the interstate
commerce law is to give the shortest line be
tween two points the advantage in transpor-
tation over roundabout lines That is per
fectly right in q business point Of view, and
its operation al present is TO the advantage
- st+t -O0eH Qua
the effect of the South Penn is not only that
it viii share this advantage. but il will
pancture the huge capitalization of the
Pennsylvania. What chances viii that cor
poration have to force rates that will yield 8
per cent. on its immense capital, practically
representing the cost Of two roads. with a
competing line that will cost ss4 100000 ?
This is the point which agitates the Penn
sylvania road. II is the completion ofa line
! the capital of which only represents the
modern e,st of construction that makes the
I Pennsylvania railroad 50 desperate
Is there any likelihood that its efforts to
choke of The rev project will have any sue
cess
= | do not think so. The completion offhe
South Penn as an independent line is as GER
tain as anything in the future can be. The
agreeuent for thar purpose brings up one
point about which the Pennsylvania raiIr1ad
makes an erroneous statement. Ii i alleged
that the reorganization and reconstruction
OF the South Penn roai Is betw cen the minor
ity interests. Now the fact Is that before the
agreement was presented to the subscribers
OF the South Penn project at large il had re-
ceivei the approval Of the majority Interests
The history i that a meeting was held in
New York al which representatives Of Pitts
burg and New York capital comprised ma
jority Of the South Penn capital. and the
agreement was arranged before THAI meeting
adjourned and received the signatures of the
majority Of the capital. the basis of which Is
the completion of the road When thea
ment was presented 20 the other Pittsburg
aud Philadelphia subscribers the matter was
practically settled; but the assurance has
been strengthened by the fact that over three
quarterssf the old capital has now signed
the new agreement, with some counties vet
to hear from
viii the new route be able to command
the Reading outlet
Undoubtedly II has the contract for
that purpose. and il u further true that the
Reading viii be glad to carry out the con
tract in letter and spirit instead of seeking To
evade it. A good deal Of misapprthersion
exists a 10 the position Of the Readiag In
this matter Mr. Corhin i maintaining
/ friendly relations with the Pennsylvania rail
road, a. Is good policy, on all matters in
which the interests of the two corporations
agree. But if any one supposes that he will
ss,eriflee the interests OF the Reading. in a
matter where rs prosperity is at stake, for
the sake OF ayerting the enmiiy Of the Penn
syivania, they are mistaken in the man
What is the prospect of the new road as
an investment
. The entire capitalization Is limited BY
the agreement to $4,000 common stock,
5000 600 preferred stock, and 1900 600
bonds This total Of s24Go,0o win bull d
and stock the road from Harrisburg to Pitts
burg, and is ample for all purposes. The
only question a. to the return on this invest
ment was whether the road could get $s.-
10000 tons of freight a year, and the ton
mage is now guarntee,i 70 il as soon IL il
lines are opened The Hunting 4 Brosad Top
railroad alone, which Is bottled up by the
Pennsylvania railroad at both ends, will give
that amount of freight TO the new road.
Then the tonnage coming from the Robert
Hare Powell estate and from the Western
Pennsylvania gas coal interests thai have
been shut out from the east in the interest of
the Westmoreiand Coal Company win be an
important addition to the traffic The Cum
beriand Valley which i one of tbs. richest
districts in the state. has been sqaeezed by
the Pennsylvania raiirUad. just as Pittsburg
Ustri In b.. and tn. r..n,,I. l.f rl,a- .Il..- h